India’s Services PMI climbed to a new six-month high in December, hitting 58.5 points. On the index where a result above 50 signals an expansion of the sector, the pandemic and post-pandemic economy has seen some of the highest readings of the past ten years as digital services – a strong point of the Indian services industry – boomed.
After an initial crash due to the spread of Covid-19 in early 2020, the Indian services industry suffered another contraction during the country’s devastating Delta wave in mid-2021. The Omicron winter of 2021/22 did slow growth but didn’t break the streak of 17 straight months of expansion since August 2021.
Sectors that showed a good performance on the index were the finance and insurance as well as the real estate and business services industries, according to S&P Global.
While India’s trade deficit has been widening post-pandemic as global crises and economic slowdowns cratered demand for goods, the country’s services exports, for example through the prolific outsourcing industry, have propped up the nation’s trade balance somewhat.